business unit 1

Business Activity Types

Primary involves raw material extraction, secondary is manufacturing, and tertiary offers services like supermarkets and banks.

Sectors of Operation

Private sector is for-profit businesses owned by individuals, public sector is government-owned, and third sector includes charities.

Legal Business Ownership Forms

Sole trader has one owner with unlimited liability, partnership has multiple owners with unlimited liability, private limited companies are owned by shareholders, and public limited companies are owned by multiple shareholders.

Factors Informing Business Ownership

Legal status, liability, funding sources, and decision-making influence business ownership structures.

Business Aims and Objectives

Include survival, financial goals, reputation, growth, and being enterprising.

Functional Areas of Businesses

Finance, marketing, sales, human resources, operations management, customer service, research and development, purchasing, and business support services.

Interrelation of Business Functions

Emphasizes the need for good communication and how poor performance in one area can affect others.

Organisational Structures

Can be based on function, product/service, or geographical location, with variations like flat, tall, and matrix structures.

Impact of Organisational Structures

Tall structures have longer communication paths than flat structures, affecting business operations.

Financial Health of Business

Involves understanding costs, revenue, cash flow, profit/loss, and break-even point.

Profit/Loss and Break-Even Calculation

Profit is revenue minus cost, while break-even point is fixed costs divided by selling price minus variable cost per unit.

Business-Stakeholder Relationship

Internal stakeholders include owners, employees, and trade unions, while external stakeholders encompass all others.